Rpm and funnel management tpma-2013-05

Is Your Marketing Working?
John Stetic
Egan Cheung

Buying Process Shifting …
Education Active Buying Closing
• Sales-dominated
• One-way, single channel, relationship-driven
Marketing

Buying Process Shifting to Marketing-Driven
Education Active Buying Closing
• Marketing plays critical role
• Buyers choice, analytics-driven
Marketing

The Flexibility to Manage Your Unique Business

You Need a True Multichannel Platform
Owned
Earned
Paid

Marketing ROI, RPIs, and Benchmarking

Median Cumulative Revenue Growth

Sample Size: 27
Sample Size: 155
Sample Size: 500
5X the
Growth!
What do they
know that we
don’t?

Revenue Performance Management
A strategy for managing a
company’s interactions with
buyers through the
entire buying cycle that enables
predictable, rapid and profitable
revenue growth.

Assessing the Financial Health of a Business
INCOME
STATEMENT
• Profit margin
• AR turnover
• AP turnover
• Inventory turns
BALANCE
SHEET
• Current ratio
• Quick ratio
• Leverage ratio
• ROI
CASH
FLOW
• External financing
index ratio
• Cash sources ratio
• Operating cash
index ratio

Assessing the Health of Your Revenue Engine
VALUE
• Weighted Marketing
Pipeline Value
• Weighted Sales
Pipeline Value
• Marketing/Sales
Pipeline Ratio
PERFORMANCE
• Reach
• Share of Audience
• Revenue Conversion
• Days Leads Outstanding
• Buy Cycle
• Sales Cycle
EFFICIENCY
• Customer Acquisition
Cost Ratio
• Campaign ROI
• Sales Sizing
• Economic Value of
Conversion

A Different Revenue Structure
Marketing
Responses
Clicks/Visits
Volume
Costs
Source
Executives
Revenue
Profitability
Cash-flow

A Different Revenue Structure
Marketing
Responses
Clicks/Visits
Volume
Costs
Source
Executives
Revenue
Profitability
Cash-flow
Revenue Steering Committee
Revenue Cycle Dynamics

Silos of Data = Incomplete Picture
RevenueProspect
Qualified
Lead
Sales
Accepted Lead
(SAL)
Suspect
Sales
Qualified Lead
(SQL)
SFA systems
Call notes/(…more
spreadsheets
Email systems,
event systems (more
spreadsheets)
Web analytics,
social media
(spreadsheets)

The Right Revenue Process
RevenueProspect
Marketing
Qualified
Lead
(MQL)
Sales
Accepted Lead
(SAL)
Suspect
Sales
Qualified Lead
(SQL)
Evaluate PurchaseLearn JustifyInterest
Sales &
Marketing
Process
Marketing
validates quality
of interest
Marketing
nurtures to
sales ready
Sales validates
and accepts
ownership
Sales validates
revenue criteria
Sales closes
revenue
opportunity
Buying Process

The Results

Questions your CEO should be asking
And so should you!
Is there value
weakness at a
particular stage in
my funnel?
Do I have the
expected number of
leads in my funnel
stages?
Are leads converting
as anticipated?
What tactics can
improve this?
Are leads and
opportunities
getting ‘stuck’
in the funnel?
What tactics
generate the
highest return?

Critical Insights to For Driving Revenue
Value
What’s the value of
my pipeline?
Reach
Who can I target to
drive value?
Conversion
What % of
prospects will
become revenue?
Eloqua creates modern marketers that know exactly what their customers and
prospects want, enabling them to deliver a superior customer experience and to
drive revenue growth for their organizations
Velocity
How long will it take
to realize revenue
from a prospect?
Return
What is the revenue
return on my
marketing and
sales investment?

RPI: Reach Demo
I don’t know if my
database is growing
fast enough to hit my
revenue number.
What: Reach shows the number
of ‘reachable’ marketing contacts
for each month. Calculated as the
green additions less the red losses
of Contacts in the database).
Why: Reach helps executives
better allocate resources towards
database growth vs. prospect
engagement & conversion.
Reach, Conversion & Value can be
used to calculate long term
revenue forecasts.How many leads
do we acquire and
lose over time?

RPI: Reach Demo
What is it: The Reach by Stage
shows the distribution of leads and
opportunities through the revenue
cycle for the time period selected.
You can toggle between a bar or
funnel view of the data.
Why: Executives want to know how
marketing and sales teams are
doing at filling the funnel. The Reach
by Stage drill down lets users to
compare the volume of leads and
opportunities in the revenue cycle
against earlier time periods, and
assess whether this volume is
enough to meet forward revenue
targets.
What does my revenue cycle
look like today and how does
that compare against prior
time frames?

RPI: Reach Demo
What is it: The Reach Trend and
Benchmark chart shows the trend in
Reach for the four standard stage
types and provides a comparison of
your Reach growth rate to the
Eloqua Benchmark Index.
Why: You grew your pipeline by
15%, but how does that compare to
top performers? Benchmarking
helps executives understand how
their organizations stack up against
others and pinpoint where
processes can be improved to
generate more revenue over time.
By stage type, how
has my change in
reach trended and
how do I compare?

RPI: Conversion Demo
What is the ratio
of won deals to
new prospects in
a time period?
What: Conversion is the percent of a
‘class’ of leads that progress through
the entire funnel to Closed Revenue.
The Conversion RPI is an indicator of
marketing and sales efficiency. The
Orange line shows the number of
closed opportunities divided by the
number of prospects entering a
revenue cycle. The Blue line (RPI)
shows true conversion of leads over
time (ratio of lead from this period that
eventual close).
Why: Conversion answers the
question – “what percent of interested
prospects will become closed deals?”
– a critical measure of revenue
production. It is also the key to long
term forecasting.
What percent of
leads generated
actually convert to
revenue?

RPI: Conversion Demo How are my
leads converting
through stages?
How does my
conversion rate
compare to
industry standards?
What: The Conversion Rate by
Stage shows the stage-to-stage
conversion rate through the
integrated sales and marketing
funnel for the month highlighted.
Why: This tells you where to
focus to have the biggest impact
(for example, small conversion
rate improvements at the top of
the funnel can yield big revenue
gains at the bottom).

RPI: Value Demo
Are we
consistently
adding Value to
our revenue
cycle?
What: Value is the total revenue
expected from the current lead
inventory in end-to-end revenue
pipeline.
Why: The Value RPI helps
executives understand the
revenue dollars associated with
each stage of the revenue cycle
– from clicks all the way to
closed deals. It answers the
question “Are my sales and
marketing investments creating
revenue opportunities?”

RPI: Value Demo Which stages of
the revenue cycle
are weakest?
What: The Valueby Stage chart
shows a snapshot of the value
distribution throughout the
stages of the integrated sales
and marketing funnel for the time
period selected.
Why: Executives can use this
chart to compare time periods
and assess where the funnel
may be losing or gaining value.

RPI: Velocity Demo
 Presenter Name
Date
Drill Down: For month X,
What is the velocity
distribution?
What: Velocity is the average time it
takes for potential buyers to reach an
end point in the revenue cycle. The
blue trend line shows the average
number of days between Prospect
and Closed Revenue for deals closed
in the month highlighted. The green
bars represent the volume of revenue
cycles that were closed in that time
period.
Why: Time creates huge
inefficiencies in your revenue cycle.
After all, the longer your revenue
cycle, the fewer opportunities your
sales team can close in a given
period of time.
How long will it
take for today’s
leads to convert
into revenue?

RPI: Velocity Demo
What: The upper right hand
chart presents the distribution of
closed deals grouped by average
cycle length. On the bottom, your
average Velocity for the time
period is compared to the Eloqua
Benchmark Index.
Why: It is likely that executives
would want to have the trends by
stage analyzed in detail and ask
their revenue steering committee
or marketing operations team
drill into underlying data to
investigate velocity by deal size,
region, product sku or lead
In what stage are
slowdowns
occurring and
how can we
optimize?

RPI: Return Demo
What: Return shows the Return
percentage for each month (revenues
generated divided by the costs spent).
By adjusting the slider at the bottom
of the chart, the specific 12 months
included in the analysis can be
changed.
Why: Every executive wants to know
how their marketing and sales
expense translate into revenue. In
fact, most financial types want an
answer to the question: “What will
one more dollar in investment in sales
& marketing yield in revenue?” This
dashboard aggregates that up to an
overall return on dollars spent within a
set time period.
What return have
we realized on the
marketing
investments in a
given time period?
How much revenue
has been created
from the spend in a
given time period?

RPI: Return Demo
What: The upper right hand chart in
provides a snapshot of when sales
and marketing campaign investments
break-even and begin to have a
profitable impact on revenue growth.
The lower right chart provides a
snapshot into your overall Return on
sales and marketing campaign
investments.
Why: Executives want to know what
is working so it can be repeated.
Periods of time with high marketing
and sales returns need to be
examined against campaign, product
and regional factors to find the
winning mix.
How long will it take
me to see a positive
return on my
marketing and sales
expenditures?

Revenue Benchmark Index
Sparkline: your
performance by stage
type over time period
against static benchmark
Benchmarks: your
performance against
industry best, average
and laggards, by stage.

ASP $25,000
# of deals 400
velocity (months 5
velocity (qut) 2
month/period 3
conversion 0.30%
FY1 Bookings $10,000,000 FY2 $15,000,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Prospects 3,200 9,600 1,920 4,800 4,800 7,680 - -
MQL 1,600 4,800 960 2,400 2,400 3,840 - -
SQL 400 1,200 240 600 600 960 - -
SQO - 200 600 120 300 300 480 -
Closed - - 100 300 60 150 150 240
% of annual booking 0% 0% 25% 75% 10% 25% 25% 40%
Qtr. booking target $- $- $2,500,000 $7,500,000 $1,500,000 $3,750,000 $3,750,000 $6,000,000
running bookings $- $- $2,500,000 $7,500,000 $1,500,000 $5,250,000 $9,000,000 $15,000,000
Conversion Base Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
P>MQL 5% 50% 50% 50% 50% 50% 50% 50% 50%
MQL>SQL 60% 25% 25% 25% 25% 25% 25% 25% 25%
SQL>SQO 50% 50% 50% 50% 50% 50% 50% 50% 50%
SQL>Closed 20% 50% 50% 50% 50% 50% 50% 50% 50%
P>Closed 0.300% 3.125% 3.125% 3.125% 3.125% 3.125% 3.125% 3.125% 3.125%
Stage Velocity
P>MQL 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0
MQL>SQL 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0
SQL>SQO 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0
SQL>Closed 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0
Running Velocity
P>MQL 1 1 1 1 1 1 1 1 1
MQL>SQL 2 2 2 2 2 2 2 2 2
SQL>SQO 3 3 3 3 3 3 3 3 3
SQL>Closed 5 5 5 5 5 5 5 5 5
-
10,000
20,000
$-
$5,000,000
$10,000,000
Q1 Q2 Q3 Q4
(5,000)
5,000
15,000
$-
$5,000,000
$10,000,000
Q1 Q2 Q3 Q4

Rpm and funnel management tpma-2013-05

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Rpm and funnel management tpma-2013-05